Exhibit 4(b)
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AEP TEXAS NORTH COMPANY
TO
BANK ONE, N.A.
AS TRUSTEE
FIRST SUPPLEMENTAL INDENTURE
DATED AS OF FEBRUARY 1, 2003
$225,000,000
5.50% SENIOR NOTES, SERIES A DUE 2013
5.50% SENIOR NOTES, SERIES B DUE 2013
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TABLE OF CONTENTS
PAGE
ARTICLE I Additional Definitions..................................................................................1
SECTION 1.01. Definitions..............................................................................1
ARTICLE II 2013 Notes.............................................................................................3
SECTION 2.01. Establishment............................................................................3
SECTION 2.02. Aggregate Principal Amount...............................................................4
SECTION 2.03. Maturity and Interest....................................................................4
SECTION 2.04. Optional Redemption......................................................................4
SECTION 2.05. Limitation on Secured Debt...............................................................5
SECTION 2.06. Global Securities and Certificated Securities............................................6
SECTION 2.07. Form of Securities.......................................................................8
SECTION 2.08. Transfer and Exchange....................................................................8
ARTICLE III Miscellaneous Provisions.............................................................................13
SECTION 3.01. Recitals by Company.....................................................................13
SECTION 3.02. Ratification and Incorporation of Original Indenture....................................13
SECTION 3.03. Executed in Counterparts................................................................13
SECTION 3.04. Legends.................................................................................13
SECTION 3.05. Applicability of Section 4.05 and Article Ten of Original Indenture.....................13
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* This Table of Contents does not constitute part of the Indenture or have
any bearing upon the interpretation of any of its terms and provisions.
i
THIS FIRST SUPPLEMENTAL INDENTURE is made as of the 1st day of
February, 2003, between AEP TEXAS NORTH COMPANY, a corporation duly organized
and existing under the laws of the state of Texas (herein called the "Company"),
having its principal office at 0 Xxxxxxxxx Xxxxx, Xxxxxxxx, Xxxx 00000 and Bank
One, N.A., a national banking association, duly organized and existing under the
laws of the United States, having its principal corporate trust office at 0000
Xxxxxxx Xxxxxxx, Xxxxxxxx, Xxxx 00000, as Trustee (herein called the "Trustee").
W I T N E S S E T H:
WHEREAS, the Company has heretofore entered into an Indenture, dated as
of February 1, 2003 (the "Original Indenture"), with the Trustee;
WHEREAS, the Original Indenture is incorporated herein by this
reference and the Original Indenture, as supplemented by this First Supplemental
Indenture, is herein called the "Indenture";
WHEREAS, under the Original Indenture, a new series of unsecured notes
(the "Senior Notes") may at any time be established by the Board of Directors of
the Company in accordance with the provisions of the Original Indenture and the
terms of such series may be described by a supplemental indenture executed by
the Company and the Trustee;
WHEREAS, the Company proposes to create under the Indenture a series of
Senior Notes to be designated the "5.50% Senior Notes, Series A due 2013" (the
"Series A Notes") and a series of Senior Notes to be designated the "5.50%
Senior Notes, Series B due 2013" (the "Series B Notes" and, together with the
Series A Notes, the "2013 Notes"), the form and substance of the 2013 Notes and
the terms, provisions and conditions thereof to be set forth as provided in the
Original Indenture and this First Supplemental Indenture;
WHEREAS, additional Senior Notes of other series hereafter established,
except as may be limited in the Original Indenture as at the time supplemented
and modified, may be issued from time to time pursuant to the Indenture as at
the time supplemented and modified; and
WHEREAS, all conditions necessary to authorize the execution and
delivery of this First Supplemental Indenture and to make it a valid and binding
obligation of the Company have been done or performed.
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
ADDITIONAL DEFINITIONS
SECTION 1.01. DEFINITIONS
The following defined terms used herein shall, unless the context
otherwise requires, have the meanings specified below. Capitalized terms used
herein for which no definition is provided herein shall have the meanings set
forth in the Original Indenture.
"Clearstream" means Clearstream Banking, societe anonyme, or any
successor securities clearing agency.
"Distribution Compliance Period," with respect to the 2013 Notes, means
the period of 40 consecutive days beginning on and including the later of (i)
the day on which such 2013 Notes are first offered to Persons other than
distributors (as defined in Regulation S under the Securities Act) in reliance
on Regulation S and (ii) the Original Issue Date.
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"Euroclear" means Euroclear Bank S.A./N.V., as operator of the
Euroclear System or any successor securities clearing agency.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Offer Registration Statement" shall have the meaning assigned
to it in the Registration Rights Agreement.
"Generation-Related Business" has the meaning set forth in Section
3.05(a).
"Global Securities" means global certificates representing the 2013
Notes as described in Section 204.
"Holder" means a registered holder of a 2013 Note.
"Institutional Accredited Investor" has the meaning set forth in
Section 2.04(a) hereof.
"Original Issue Date" means February 18, 2003.
"Owner" means each Person who is the beneficial owner of a Global
Security as reflected in the records of the Depository or, if a Depository
participant is not the Owner, then as reflected in the records of a Person
maintaining an account with such Depository (directly or indirectly, in
accordance with the rules of such Depository).
"Permanent Regulation S Global Security" has the meaning set forth in
Section 2.04(b).
"QIBs" means qualified institutional buyers as defined in Rule 144A.
"Registered Exchange Offer" shall have the meaning assigned to Exchange
Offer in the Registration Rights Agreement
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of February 1, 2003 among the Company and the Initial
Purchasers named therein, relating to the registration of the 2013 Notes under
the Securities Act.
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"Regulation S" means Regulation S under the Securities Act and any
successor regulation thereto.
"Rule 144" means Rule 144 under the Securities Act, as such rule may be
amended from time to time, or any similar rule or regulation hereafter adopted
by the Securities and Exchange Commission.
"Rule 144A" means Rule 144A under the Securities Act, as such rule may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the Securities and Exchange Commission.
"Rule 144A Global Security" means any Series A Note that is to be
traded pursuant to Rule 144A.
"Securities Act" means the Securities Act of 1933, as amended from time
to time, or any successor legislation.
"Securities Custodian" means the custodian with respect to a Global
Security (as appointed by the Depository), or any successor Person thereto and
shall initially be the Trustee.
"Shelf Registration Statement" shall have the meaning assigned to it in
the Registration Rights Agreement.
"Special Interest Premium" shall have the meaning assigned to it in the
Registration Rights Agreement.
"Stated Maturity" means March 1, 2013.
"Subsidiary" means any corporation or other entity of which sufficient
voting stock or other ownership or economic interests having ordinary voting
power to elect a majority of the board of directors (or equivalent body) are at
the time directly or indirectly held by the Company.
"Temporary Regulation S Global Security" has the meaning set forth in
Section 2.04(b).
"Transfer Restricted Security" shall have the meaning assigned to
Registrable Note in the Registration Rights Agreement.
ARTICLE II
2013 NOTES
SECTION 2.01. ESTABLISHMENT. The Series A Notes shall be designated as
the Company's "5.50% Senior Notes, Series A due 2013" and the Series B Notes
shall be designated as the Company's "5.50% Senior Notes, Series B due 2013".
The Series A Notes and the Series B Notes shall be treated for all purposes
under the Indenture as a single class or series of Senior Notes.
3
SECTION 2.02. AGGREGATE PRINCIPAL AMOUNT. The Trustee shall
authenticate and deliver (i) Series A Notes for original issue on the Original
Issue Date in the aggregate principal amount of $225,000,000 and (ii) Series B
Notes from time to time thereafter for issue only in exchange for Series A Notes
pursuant to the Exchange Offer Registration Statement in accordance with the
Registration Rights Agreement or pursuant to the Shelf Registration Statement in
accordance with the Registration Rights Agreement, in each case upon a Company
Order for authentication and delivery thereof and satisfaction of Section 2.01
of the Original Indenture. The aggregate principal amount of the 2013 Notes
shall be initially limited to $225,000,000 and shall be subject to Periodic
Offerings pursuant to Article Two of the Original Indenture. All 2013 Notes need
not be issued at the same time and such series may be reopened at any time,
without the consent of any Holder, for issuances of additional 2013 Notes. Any
such additional 2013 Notes will have the same interest rate, maturity and other
terms as those initially issued. The Series A Notes shall be issued in
definitive fully registered form.
SECTION 2.03. MATURITY AND INTEREST. (i) The 2013 Notes shall mature
on, and the date on which the principal of the 2013 Notes shall be payable
(unless earlier redeemed) shall be, March 1, 2013;
(ii) the interest rate at which the 2013 Notes shall bear interest shall
be 5.50% per annum; provided, however, that the Special Interest
Premium shall accrue on the 2013 Notes under certain circumstances as
provided in clause (iii) below; interest shall accrue from the date
of authentication of the 2013 Notes; the Interest Payment Dates on
which such interest will be payable shall be March 1 and September 1,
and the Regular Record Date for the determination of holders to whom
interest is payable on any such Interest Payment Date shall be the
February 15 or August 15 preceding the relevant Interest Payment
Date; provided that the first Interest Payment Date shall be
September 1, 2003 and interest payable on the Stated Maturity or any
redemption date shall be paid to the Person to whom principal shall
be paid; each payment of interest shall include interest accrued
through the day before the Interest Payment Date;
(iii) Special Interest Premium shall accrue on the Transfer Restricted
Securities over and above the interest rate set forth herein in
accordance with Section 2(e) of the Registration Rights Agreement.
SECTION 2.04. OPTIONAL REDEMPTION. The 2013 Notes shall be redeemable at
the option of the Company, in whole at any time or in part from time to time,
upon not less than thirty but not more than sixty days' previous notice given by
mail to the registered owners of the Notes at a redemption price equal to the
greater of (i) 100% of the principal amount of the 2013 Notes being redeemed and
(ii) the sum of the present values of the remaining scheduled payments of
principal and interest on the 2013 Notes being redeemed (excluding the portion
of any such interest accrued to the date of redemption) discounted (for purposes
of determining present value) to the redemption date on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Treasury
Rate (as defined below) plus 25 basis points, plus, accrued interest thereon to
the date of redemption.
4
"Treasury Rate" means, with respect to any redemption date, the rate
per annum equal to the semi-annual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury
Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such redemption date.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the 2013 Notes that would be utilized,
at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of the 2013 Notes.
"Comparable Treasury Price" means, with respect to any redemption
date, (i) the average of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal
amount) on the third Business Day preceding such redemption date, as set
forth in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30 p.m.
Quotations for U. S. Government Securities" or (ii) if such release (or any
successor release) is not published or does not contain such prices on such
third Business Day, the Reference Treasury Dealer Quotation for such
redemption date.
"Independent Investment Banker" means one of the Reference Treasury
Dealers appointed by the Company and reasonably acceptable to the Trustee.
"Reference Treasury Dealer" means a primary U.S. government securities
dealer selected by the Company and reasonably acceptable to the Trustee.
"Reference Treasury Dealer Quotation" means, with respect to the
Reference Treasury Dealer and any redemption date, the average, as
determined by the Trustee, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal
amount) quoted in writing to the Trustee by such Reference Treasury Dealer
at or before 5:00 p.m., New York City time, on the third Business Day
preceding such redemption date.
SECTION 2.05. LIMITATION ON SECURED DEBT. So long as any of the 2013 Notes
are outstanding, the Company shall not create or suffer to be created or to
exist or permit any of its Subsidiaries to create or suffer to be created or to
exist any additional mortgage, pledge, security interest, or other lien
(collectively "Liens") on any utility properties or tangible assets now owned or
hereafter acquired by the Company or its Subsidiaries to secure any indebtedness
for borrowed money ("Secured Debt"), without providing that such 2013 Notes will
be similarly secured. Further, this restriction on Secured Debt does not apply
to the Company's existing first mortgage bonds that have previously been issued
under its mortgage indenture or any indenture supplemental thereto; provided
that this restriction will apply to future issuances thereunder (other than
issuances of refunding first mortgage bonds). In addition, this restriction does
not prevent the creation or existence of:
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o Liens on property existing at the time of acquisition or construction
of such property (or created within one year after completion of such
acquisition or construction), whether by purchase, merger,
construction or otherwise, or to secure the payment of all or any part
of the purchase price or construction cost thereof, including the
extension of any Liens to repairs, renewals, replacements,
substitutions, betterments, additions, extensions and improvements
then or thereafter made on the property subject thereto;
o Financing of the Company's accounts receivable for electric service;
o Any extensions, renewals or replacements (or successive extensions,
renewals or replacements), in whole or in part, of Liens permitted by
the foregoing clauses; and
o The pledge of any bonds or other securities at any time issued under
any of the Secured Debt permitted by the above clauses.
In addition to the permitted issuances above, Secured Debt not otherwise so
permitted may be issued in an amount that does not exceed 15% of Net Tangible
Assets as defined below.
"Net Tangible Assets" means the total of all assets (including revaluations
thereof as a result of commercial appraisals, price level restatement or
otherwise) appearing on the Company's balance sheet, net of applicable reserves
and deductions, but excluding goodwill, trade names, trademarks, patents,
unamortized debt discount, energy trading contracts, regulatory assets, deferred
charges and all other like intangible assets (which term shall not be construed
to include such revaluations), less the aggregate of the Company's current
liabilities appearing on such balance sheet.
This restriction also will not apply to or prevent the creation or
existence of leases (operating or capital) made, or existing on property
acquired, in the ordinary course of business.
SECTION 2.06. GLOBAL SECURITIES AND CERTIFICATED SECURITIES.
(a) GENERAL. The Series A Notes will be resold initially only to (i)
QIBs in reliance on Rule 144A under the Securities Act ("Rule 144A"), (ii)
institutional "accredited investors" as such term is defined in rule
501(a)(1), (2),(3) and (7) of Regulation D under the Securities Act (each,
an "Institutional Accredited Investor") and (iii) Persons other than U.S.
Persons (as defined in Regulation S) in reliance on Regulation S under the
Securities Act ("Regulation S"). Series A Notes may thereafter be
transferred to, among others, QIBs, purchasers in reliance on Regulation S,
and Institutional Accredited Investors in each case, subject to the
restrictions on transfer set forth herein.
(b) GLOBAL SECURITIES.
(i) FORM. Series A Notes initially resold pursuant to Rule 144A
shall be issued initially in the form of one or more permanent Global
Securities in definitive, fully registered form (collectively, the
"Rule 144A Global Security")
6
and Series A Notes initially resold pursuant to Regulation S and shall
be issued initially in the form of one or more temporary global
securities in definitive, fully registered form (collectively, the
"Temporary Regulation S Global Security"), in each case without
interest coupons and with the global securities legend and restricted
securities legend set forth in Exhibit A hereto, which shall be
deposited on behalf of the purchasers of the Series A Notes
represented thereby with the Securities Custodian, and registered in
the name of the Depository or a nominee of the Depository, duly
executed by the Company and authenticated by the Trustee as provided
in the Indenture. Except as set forth in this Section 2.06, beneficial
ownership interests in the Temporary Regulation S Global Security (x)
will not be exchangeable for interests in the Rule 144A Global
Security, the permanent global security (the "Permanent Regulation S
Global Security"), or any other security without a legend containing
restrictions on transfer of such security prior to the expiration of
the Distribution Compliance Period and (y) then may be exchanged for
interests in a Rule 144A Global Security or the Permanent Regulation S
Global Security only upon certification that beneficial ownership
interests in such Temporary Regulation S Global Security are owned
either by non-U.S. persons or U.S. persons who purchased such
interests in a transaction that did not require registration under the
Securities Act.
The Rule 144A Global Security, the Temporary Regulation S Global
Security and the Permanent Regulation S Global Security are collectively
referred to herein as "Global Securities". The aggregate principal amount
of the Global Securities may from time to time be increased or decreased by
adjustments made on the records of the Trustee and the Depository or its
nominee as hereinafter provided.
(ii) BOOK-ENTRY PROVISIONS. This Section shall apply only to a
Global Security deposited with or on behalf of the Depository. The
Company shall execute and the Trustee shall, in accordance with this
Section 2.06(b)(ii), authenticate and deliver initially one or more
Global Securities that (a) shall be registered in the name of the
Depository for such Global Security or Global Securities or the
nominee of such Depository and (b) shall be delivered by the Trustee
to such Depository or pursuant to such Depository's instructions or
held by the Trustee as custodian for the Depository.
Members of, or participants in, the Depository ("Agent Members") shall
have no rights under this Indenture with respect to any Global Security
held on their behalf by the Depository or by the Trustee as the custodian
of the Depository or under such Global Security, and the Company, the
Trustee and any agent of the Company or the Trustee shall be entitled to
treat the Depository as the absolute owner of such Global Security for all
purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Company, the Trustee or any agent of the Company or the Trustee
from giving effect to any written certification, proxy or other
authorization furnished by the Depository or impair, as between the
Depository and its Agent Members, the operation of customary practices of
such Depository governing the exercise of the rights of a holder of a
beneficial interest in any Global Security.
7
To the extent a notice or other communication to the beneficial owners
of the 2013 Notes is required under the Indenture, unless and until
Certificated Securities shall have been issued to such owners, the Trustee
shall give all such notices and communications specified herein to be given
to such owners to the Depository, and shall have no obligations to such
Owners.
(c) CERTIFICATED SECURITIES. Series A Notes sold to Institutional
Accredited Investors shall be issued initially in the form of a fully
registered, certificated Series A Note ("Certificated Securities"). Except
as provided in this Section 2.06, owners of beneficial interests in Global
Securities shall not be entitled to receive physical delivery of
Certificated Securities.
Global Securities shall be exchangeable for Certificated Securities if (i)
the Depository (x) notifies the Company that it is unwilling or unable to
continue as Depository for the Global Securities or (y) shall no longer be
registered or in good standing under the Exchange Act, or other applicable
statute or regulation, and a successor Depository for the Global Securities is
not appointed by the Company within 90 days after the Company receives such
notice or becomes aware of such condition. Upon surrender to the Trustee of the
typewritten certificate or certificates representing the Global Securities by
the Depository, accompanied by registration instructions, the Trustee shall
execute and authenticate the certificates in accordance with the instructions of
the Depository. Neither the Security Registrar nor the Trustee shall be liable
for any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. Upon the issuance of
Certificated Securities, the Trustee shall recognize the Holders of the
Certificated Securities as Holders. The Certificated Securities shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Company, as evidenced by the execution thereof by
the Company, and shall bear the legend set forth on Exhibit A hereto unless the
Company informs the Trustee that such legend is no longer required.
SECTION 2.07. FORM OF SECURITIES. The Global Securities and Certificated
Securities shall be substantially in the form attached as Exhibit A thereto.
SECTION 2.08. TRANSFER AND EXCHANGE.
(a) GENERAL. The 2013 Notes may not be transferred except in
compliance with the legend contained in Exhibit A unless otherwise
determined by the Company in accordance with applicable law. No service
charge will be made for any transfer or exchange of 2013 Notes, but payment
will be required of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection therewith.
(b) TRANSFER AND EXCHANGE OF GLOBAL SECURITIES.
(i) If a holder of a beneficial interest in the Rule 144A Global
Security wishes at any time to exchange its interest in the Rule 144A
Global Security for an interest in the Permanent Regulation S Global
Security, or to transfer its interest in the Rule 144A Global Security
to a person who wishes to take delivery thereof in the form of an
interest in the Permanent Regulation S Global Security,
8
such holder may, subject to the rules and procedures of the Depository
and to the requirements set forth in the following sentence, exchange
or cause the exchange or transfer or cause the transfer of such
interest for an equivalent beneficial interest in the Permanent
Regulation S Global Security. Upon receipt by the Trustee, as transfer
agent, of (1) instructions given in accordance with the Depository's
procedures from or on behalf of a holder of a beneficial interest in
the Rule 144A Global Security, directing the Trustee, as transfer
agent, to credit or cause to be credited a beneficial interest in the
Permanent Regulation S Global Security in an amount equal to the
beneficial interest in the Rule 144A Global Security to be exchanged
or transferred, (2) a written order given in accordance with the
Depository's procedures containing information regarding the Euroclear
or Clearstream account to be credited with such increase and the name
of such account, and (3) a certificate in the form of Exhibit C hereto
given by the holder of such beneficial interest stating that the
exchange or transfer of such interest has been made pursuant to and in
accordance with Rule 903 or Rule 904 of Regulation S under the
Securities Act, the Trustee, as transfer agent, shall promptly deliver
appropriate instructions to the Depository, its nominee, or the
custodian for the Depository, as the case may be, to reduce or reflect
on its records a reduction of the Rule 144A Global Security by the
aggregate principal amount of the beneficial interest in such Rule
144A Global Security to be so exchanged or transferred from the
relevant participant, and the Trustee, as transfer agent, shall
promptly deliver appropriate instructions to the Depository, its
nominee, or the custodian for the Depository, as the case may be,
concurrently with such reduction, to increase or reflect on its
records an increase of the principal amount of such Permanent
Regulation S Global Security by the aggregate principal amount of the
beneficial interest in such Rule 144A Global Security to be so
exchanged or transferred, and to credit or cause to be credited to the
account of the person specified in such instructions (who may be
Euroclear or Clearstream or another agent member of Euroclear or
Clearstream or both, as the case may be, acting for and on behalf of
them) a beneficial interest in such Permanent Regulation S Global
Security equal to the reduction in the principal amount of such Rule
144A Global Security.
(ii) If a holder of a beneficial interest in the Permanent
Regulation S Global Security wishes at any time to exchange its
interest in the Permanent Regulation S Global Security for an interest
in the Rule 144A Global Security, or to transfer its interest in the
Permanent Regulation S Global Security to a person who wishes to take
delivery thereof in the form of an interest in the Rule 144A Global
Security, such holder may, subject to the rules and procedures of
Euroclear or Clearstream and the Depository, as the case may be, and
to the requirements set forth in the following sentence, exchange or
cause the exchange or transfer or cause the transfer of such interest
for an equivalent beneficial interest in such Rule 144A Global
Security. Upon receipt by the Trustee, as transfer agent, of (1)
instructions given in accordance with the procedures of Euroclear or
Clearstream and the Depository, as the case may be, from or on behalf
of a beneficial owner of an interest in the Permanent Regulation S
Global Security directing the Trustee, as transfer agent, to credit or
cause to be credited a beneficial interest in the Rule
9
144A Global Security in an amount equal to the beneficial interest in
the Permanent Regulation S Global Security to be exchanged or
transferred, (2) a written order given in accordance with the
procedures of Euroclear or Clearstream and the Depository, as the case
may be, containing information regarding the account with the
Depository to be credited with such increase and the name of such
account, and (3) prior to the expiration of the Distribution
Compliance Period, a certificate in the form of Exhibit C hereto given
by the holder of such beneficial interest and stating that the person
transferring such interest in such Permanent Regulation S Global
Security reasonably believes that the person acquiring such interest
in the Rule 144A Global Security is a QIB and is obtaining such
beneficial interest for its own account or the account of a QIB in a
transaction meeting the requirements of Rule 144A and any applicable
securities laws of any state of the United States or any other
jurisdiction, the Trustee, as transfer agent, shall promptly deliver
appropriate instructions to the Depository, its nominee, or the
custodian for the Depository, as the case may be, to reduce or reflect
on its records a reduction of the Permanent Regulation S Global
Security by the aggregate principal amount of the beneficial interest
in such Permanent Regulation S Global Security to be exchanged or
transferred, and the Trustee, as transfer agent, shall promptly
deliver appropriate instructions to the Depository, its nominee, or
the custodian for the Depository, as the case may be, concurrently
with such reduction, to increase or reflect on its records an increase
of the principal amount of the Rule 144A Global Security by the
aggregate principal amount of the beneficial interest in the Permanent
Regulation S Global Security to be so exchanged or transferred, and to
credit or cause to be credited to the account of the person specified
in such instructions a beneficial interest in the Rule 144A Global
Security equal to the reduction in the principal amount of the
Permanent Regulation S Global Security. After the expiration of the
Distribution Compliance Period, the certification requirement set
forth in clause (3) of the second sentence of this Section 2.08(b)(ii)
will no longer apply to such exchanges and transfers.
(iii) Any beneficial interest in one of the Global Securities
that is transferred to a person who takes delivery in the form of an
interest in the other Global Securities will, upon transfer, cease to
be an interest in such Global Security and become an interest in the
other Global Securities and, accordingly, will thereafter be subject
to all transfer restrictions and other procedures applicable to
beneficial interests in such other Global Security Note for as long as
it remains such an interest.
(iv) Beneficial interests in Temporary Regulation S Global
Securities may be exchanged for interests in Rule 144A Global
Securities or Permanent Regulation S Global Securities if (1) such
exchange occurs in connection with a transfer of securities in
compliance with Rule 144A, and (2) the transferor of the beneficial
interest in the Temporary Regulation S Global Security first delivers
to the Trustee a written certificate (in a form satisfactory to the
Trustee) to the effect that the beneficial interest in the Temporary
Regulation S Global Security is being transferred to a Person (a) who
the transferor reasonably believes to be a QIB (b)
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purchasing for its own account or the account of a QIB in a
transaction meeting the requirements of Rule 144A, and (c) in
accordance with all applicable securities laws of the states of the
United States and other jurisdictions.
(v) During the Distribution Compliance Period, beneficial
ownership interests in Temporary Regulation S Global Securities may
only be sold, pledged or transferred through Euroclear or Clearstream
in accordance with the applicable procedures relating to such
institutions and only (i) to the Company, (ii) so long as such
security is eligible for resale pursuant to Rule 144A, to a Person
whom the selling holder reasonably believes is a QIB that purchases
for its own account or for the account of a QIB in a transaction
meeting the requirements of Rule 144A, (iii) in an offshore
transaction in accordance with Regulation S (other than a transaction
resulting in an exchange for interest in a Permanent Regulation S
Global Security), (iv) pursuant to an exemption from registration
under the Securities Act provided by Rule 144 (if applicable) under
the Securities Act or (v) pursuant to an effective registration
statement under the Securities Act, in each case in accordance with
any applicable securities laws of any state of the United States.
(c) TRANSFER AND EXCHANGE OF GLOBAL SECURITIES AND CERTIFICATED
SECURITIES.
(i) In the event that a Global Security is exchanged for a
Certificated Security as provided in Section 2.06(c), such
Certificated Security may be exchanged or transferred for one another,
subject to Section 2.05 of the Original Indenture, only in accordance
with such procedures as are substantially consistent with the
provisions of clauses (b)(i) and (ii) above (including the
certification requirements intended to ensure that such exchanges or
transfers comply with Rule 144, Rule 144A or Regulation S, as the case
may be) and as may be from time to time reasonably adopted by the
Company.
(ii) Upon receipt by the Trustee of a Certificated Security, duly
endorsed or accompanied by appropriate instruments of transfer, the
Trustee shall cancel such Certificated Security and cause, or direct
the Securities Custodian to cause, in accordance with the standing
instructions and procedures existing of the Depository and the
Securities Custodian, the aggregate principal amount of 2013 Notes
represented by the Rule 144A Global Security or Permanent Regulation S
Global Security, as applicable, to be increased by the aggregate
principal amount of the Certificated Security to be exchanged and
shall credit or cause to be credited to the account of the Person
specified in such instructions a beneficial interest in the Rule 144A
Global Security or Permanent Regulation S Global Security, as
applicable, equal to the principal amount of the Certificated Security
so canceled. If no Rule 144A Global Securities or Permanent Regulation
S Global Securities, as applicable, are then outstanding, the Company
shall issue and the Trustee shall authenticate, upon written order of
the Company in the form of an Officers' Certificate, a new Rule 144A
Global Security or Permanent Regulation S Global Security, as
applicable, in the appropriate principal amount.
11
(d) CERTIFICATES. In connection with any transfer described in
paragraphs (b) and (c) of this Section 2.08, the Trustee shall receive a
certificate of transfer in the form attached as Exhibit C hereto.
Additionally, upon any transfer or exchange to an Institutional Accredited
Investor, the Company and the Trustee shall receive a certificate in the
form attached as Exhibit D hereto.
(e) TRANSFER RESTRICTED SECURITY. Upon any sale or transfer of a
Transfer Restricted Security (including any Transfer Restricted Security
represented by a Global Security) pursuant to Rule 144 under the Securities
Act or an effective registration statement under the Securities Act, which
shall be certified to the Trustee and Security Registrar upon which each
may conclusively rely:
(i) in the case of any Transfer Restricted Security represented
by a Certificated Security, the Security Registrar shall permit the
Holder thereof to exchange such Transfer Restricted Security for a
Certificated Security that does not bear the legend set forth in
Exhibit A hereto and rescind any restriction on the transfer of such
Transfer Restricted Security; and
(ii) in the case of any Transfer Restricted Security represented
by a Global Security, such Transfer Restricted Security shall not be
required to bear the legend set forth in Exhibit A hereto if all other
interests in such Global Note have been or are concurrently being sold
or transferred pursuant to Rule 144 under the Securities Act or
pursuant to an effective registration statement under the Securities
Act.
(f) REGISTERED EXCHANGE OFFER. Notwithstanding the foregoing, upon
consummation of the Registered Exchange Offer, the Company shall issue and,
upon receipt of a Company Order in accordance with Section 2.05 of the
Original Indenture, the Trustee shall authenticate Series B Notes in
exchange for Series A Notes accepted for exchange in the Registered
Exchange Offer, which Series B Notes shall not bear the transfer
restriction legend set forth in Exhibit A hereto and shall not provide for
Special Interest Premium and the Security Registrar shall rescind any
restriction on the transfer of such Series B Notes, in each case unless the
Holder of such Series A Notes (A) is a broker-dealer tendering Series A
Notes acquired directly from the Company or an "affiliate" (as defined in
Rule 144 under the Securities Act) of the Company for its own account, (B)
is a Person who has an arrangement or understanding with any Person to
participate in the "distribution" (within the meaning of the Securities
Act) of the Series B Notes, (C) is a Person who is an "affiliate" (as
defined in Rule 144 under the Securities Act) of the Company or (D) will
not be acquiring the Series B Notes in the ordinary course of such Holder's
business. The Company shall identify to the Trustee such Holders in a
written certification signed by an Officer of the Company and, absent
certification from the Company to such effect, the Trustee shall assume
that there are no such Holders.
12
ARTICLE III
MISCELLANEOUS PROVISIONS
SECTION 3.01. RECITALS BY COMPANY. The recitals in this First Supplemental
Indenture are made by the Company only and not by the Trustee, and all of the
provisions contained in the Original Indenture in respect of the rights,
privileges, immunities, powers and duties of the Trustee shall be applicable in
respect of 2013 Notes and of this First Supplemental Indenture as fully and with
like effect as if set forth herein in full.
SECTION 3.02. RATIFICATION AND INCORPORATION OF ORIGINAL INDENTURE. As
supplemented hereby, the Original Indenture is in all respects ratified and
confirmed, and the Original Indenture and this First Supplemental Indenture
shall be read, taken and construed as one and the same instrument.
SECTION 3.03. EXECUTED IN COUNTERPARTS. This First Supplemental Indenture
may be simultaneously executed in several counterparts, each of which shall be
deemed to be an original, and such counterparts shall together constitute but
one and the same instrument.
SECTION 3.04. LEGENDS. Except as determined by the Company in accordance
with applicable law, each 2013 Note shall bear the applicable legends relating
to restrictions on transfer pursuant to the securities laws in substantially the
form set forth on Exhibit A hereto.
SECTION 3.05. APPLICABILITY OF SECTION 4.05 AND ARTICLE TEN OF ORIGINAL
INDENTURE. As long as the 2013 Notes are outstanding, Section 4.05 and Article
Ten of the Original Indenture shall be applicable thereto; provided, however,
that if the Company's generation-related assets ("Generation-Related Business")
are transferred or sold (whether or not the Generation-Related Business
constitutes "substantially all" of the Company's total assets), the 2013 Notes
will continue to be obligations of the Company.
13
IN WITNESS WHEREOF, each party hereto has caused this instrument to be
signed in its name and behalf by its duly authorized signatories, all as of the
day and year first above written.
AEP TEXAS NORTH COMPANY
By_/s/ Xxxxx Tomasky_
Vice President
Attest:
By_/s/ X. X. Xxxxxxxxxx
Assistant Secretary
BANK ONE, N. A.,
as Trustee
By_/s/ Xxxxxxx X. Eubank__
Vice President
Attest:
By_/s/ Xxxxx X. Knox__
Trust Officer
EXHIBIT A
FORM OF SERIES [A/B] NOTE
[Rule 144A Global Security]
[Regulation S Global Security]
[Certificated Security]
[FORM OF FACE OF INITIAL SECURITY]
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION, TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OR PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[FOR REGULATION S GLOBAL NOTE ONLY] UNTIL 40 DAYS AFTER THE
COMMENCEMENT OF THE OFFERING, AN OFFER OR SALE OF NOTES WITHIN THE UNITED STATES
BY A DEALER (AS DEFINED IN THE U.S. SECURITIES ACT) MAY VIOLATE THE REGISTRATION
REQUIREMENTS OF THE U.S. SECURITIES ACT IF SUCH OFFER OR SALE IS MADE OTHERWISE
THAN IN ACCORDANCE WITH RULE 144A THEREUNDER.]
[Restricted Securities Legend]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE
Ex. A-1
TRANSFERRED OTHER THAN (A)(1) TO THE COMPANY, (2) IN A TRANSACTION ENTITLED TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT,
(3) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER
THE SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A, (4) OUTSIDE THE UNITED STATES IN A TRANSACTION
MEETING THE REQUIREMENTS OF REGULATION S UNDER THE SECURITIES ACT, (5) IN
ACCORDANCE WITH ANOTHER APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY) OR (6) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT AND (B) IN EACH CASE IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF EACH STATE OF THE UNITED STATES. AN INSTITUTIONAL
ACCREDITED INVESTOR HOLDING THIS SECURITY AGREES IT WILL FURNISH TO THE COMPANY
AND THE TRUSTEE SUCH CERTIFICATES AND OTHER INFORMATION AS THEY MAY REASONABLY
REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE
FOREGOING RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A OR (2) AN INSTITUTION THAT
IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(A)(1), (2),(3) OR (7) UNDER
THE SECURITIES ACT AND THAT IT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES
AND NOT FOR DISTRIBUTION OR (3) A NON-U.S. PERSON OUTSIDE THE UNITED STATES
WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT.
[Temporary Regulation S Global Security Legend]
EXCEPT AS SET FORTH BELOW, BENEFICIAL OWNERSHIP INTEREST IN THIS
TEMPORARY REGULATION S GLOBAL SECURITY WILL NOT BE EXCHANGEABLE FOR INTERESTS IN
THE PERMANENT REGULATION S GLOBAL SECURITY OR ANY OTHER SECURITY REPRESENTING AN
INTEREST IN THE SECURITIES REPRESENTED HEREBY WHICH DO NOT CONTAIN A LEGEND
CONTAINING RESTRICTIONS ON TRANSFER, UNTIL THE EXPIRATION OF THE "40-DAY
DISTRIBUTION COMPLIANCE PERIOD" (WITHIN THE MEANING OF RULE 903(d)(3) OF
REGULATION S UNDER THE SECURITIES ACT) AND THEN ONLY UPON CERTIFICATION IN FORM
REASONABLY SATISFACTORY TO THE TRUSTEE THAT SUCH BENEFICIAL INTERESTS ARE OWNED
EITHER BY NON-U.S. PERSONS OR U.S. PERSONS WHO PURCHASED SUCH INTERESTS IN A
TRANSACTION THAT DID NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT. DURING
SUCH 40-DAY DISTRIBUTION COMPLIANCE PERIOD, BENEFICIAL OWNERSHIP INTEREST IN
THIS TEMPORARY REGULATION S GLOBAL SECURITY MAY ONLY BE SOLD, PLEDGED OR
TRANSFERRED THROUGH EUROCLEAR BANK S.A./N.A., AS OPERATOR OF THE EUROCLEAR
SYSTEM OR CLEARSTREAM BANKING, SOCIETE ANONYME AND
Ex. A-2
ONLY (I) TO THE COMPANY, (II) IN THE UNITED STATES TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (III) OUTSIDE THE UNITED STATES IN A TRANSACTION IN ACCORDANCE WITH RULE
904 UNDER THE SECURITIES ACT, OR (IV) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASE (I) THROUGH (IV) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES. HOLDERS OF INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY WILL
NOTIFY ANY PURCHASER OF THIS SECURITY OF THE RESALE RESTRICTIONS REFERRED TO
ABOVE, IF THEN APPLICABLE.
BENEFICIAL INTERESTS IN THIS TEMPORARY REGULATIONS S GLOBAL SECURITY
MAY BE EXCHANGED FOR INTEREST IN A RULE 144A GLOBAL SECURITY ONLY IF (1) SUCH
EXCHANGE OCCURS IN CONNECTION WITH A TRANSFER OF THE NOTES IN COMPLIANCE WITH
RULE 144A, AND (2) THE TRANSFEROR OF THE REGULATION S GLOBAL SECURITY FIRST
DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS
CERTIFICATE) TO THE EFFECT THAT THE REGULATION S GLOBAL SECURITY BEING
TRANSFERRED TO A PERSON (A) WHO THE TRANSFEROR REASONABLY BELIEVES TO BE A
QUALIFIED INSTITUTIONAL BUYER WHEN THE MEANING OF RULE 144A (B) PURCHASING FOR
ITS OWN ACCOUNT OR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, AND (C) IN ACCORDANCE WITH
ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES AND OTHER
JURISDICTIONS.
BENEFICIAL INTEREST IN A RULE 144A GLOBAL SECURITY MAY BE TRANSFERRED
TO A PERSON WHO TAKES DELIVERY IN THE FORM OF AN INTEREST IN THE REGULATION S
GLOBAL SECURITY, WHETHER BEFORE OR AFTER THE EXPIRATION OF THE 40-DAY
DISTRIBUTION COMPLIANCE PERIOD, ONLY IF THE TRANSFEROR FIRST DELIVERS TO THE
TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO THE
EFFECT THAT IF SUCH TRANSFER IS BEING MADE IN ACCORDANCE WITH RULE 903 OR 904 OF
REGULATION S OR RULE 144 (IF AVAILABLE) AND THAT, IF SUCH TRANSFER OCCURS PRIOR
TO THE EXPIRATION OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD, THE INTEREST
TRANSFERRED WILL BE HELD IMMEDIATELY THEREAFTER THROUGH EUROCLEAR BANK S.A./N.A.
OR CLEARSTREAM BANKING SOCIETE ANONYME.
[Certificated Securities Legend]
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH
TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH
THE FOREGOING RESTRICTIONS.
Ex. A-3
AEP TEXAS NORTH COMPANY
5.50% Senior Notes,
Series [A/B] due
2013
CUSIP: [0000XXXX0/144A][X0000XXX0/Reg S] Original Issue Date: February 18, 2003
Stated Maturity: March 1, 2013 Interest Rate: 5.50%
Principal Amount: $225,000,000 (or such other amount as is indicated on
Schedule A)
Redeemable: Yes X No
In Whole: Yes X No
In Part: Yes X No
AEP TEXAS NORTH COMPANY, a corporation duly organized and existing
under the laws of the State of Texas (herein referred to as the "Company", which
term includes any successor corporation under the Indenture hereinafter referred
to), for value received, hereby promises to pay to [________]; or registered
assigns, the principal sum of _____ DOLLARS ($_____) [or such other amount as is
indicated on Schedule A hereto]* on the Stated Maturity specified above (or upon
earlier redemption); and to pay interest on said Principal Amount from the
Original Issue Date specified above or from the most recent interest payment
date (each such date, an "Interest Payment Date") to which interest has been
paid or duly provided for, semi-annually in arrears on March 1 and September 1
in each year, commencing on September 1, 2003, at the Interest Rate per annum
specified above, until the Principal Amount shall have been paid or duly
provided for. Interest shall be computed on the basis of a 360-day year of
twelve 30-day months.
The interest so payable, and punctually paid or duly provided for, on
any Interest Payment Date, as provided in the Indenture, as hereinafter defined,
shall be paid to the Person in whose name this Note (or one or more Predecessor
Securities) shall have been registered at the close of business on the Regular
Record Date with respect to such Interest Payment Date, which shall be the
February 15 or August 15 (whether or not a Business Day), as the case may be,
immediately preceding such Interest Payment Date, provided that interest payable
on the Stated Maturity or any redemption date shall be paid to the Person to
whom principal is paid. Any such interest not so punctually paid or duly
provided for shall forthwith cease to be payable to the Holder on such Regular
Record Date and shall be paid as provided in said Indenture.
If any Interest Payment Date, any redemption date or Stated Maturity is
not a Business Day, then payment of the amounts due on this Note on such date
will be made on the next succeeding Business Day, and no interest shall accrue
on such amounts for the period from
--------------------
* Insert in the Rule 144A Global Security and the Regulation S Global
Security only.
Ex. A-4
and after such Interest Payment Date, redemption date or Stated Maturity, as the
case may be, except that, if such Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding Business
Day, with the same force and effect as if made on such date. The principal of
(and premium, if any) and the interest on this Note shall be payable at the
office or agency of the Company maintained for that purpose in the Borough of
Manhattan, the City of New York, New York, in any coin or currency of the United
States of America which at the time of payment is legal tender for payment of
public and private debts; provided, however, that payment of interest (other
than interest payable on Stated Maturity or any redemption date) may be made at
the option of the Company by check mailed to the registered holder at such
address as shall appear in the Security Register.
This Note is one of a duly authorized series of Notes of the Company
(herein sometimes referred to as the "Notes"), specified in the Indenture
(defined below), all issued or to be issued in one or more series under and
pursuant to an Indenture dated as of February 1, 2003 duly executed and
delivered between the Company and Bank One, N. A., a national banking
association organized and existing under the laws of the United States, as
Trustee (herein referred to as the "Trustee") (such Indenture, as originally
executed and delivered and as thereafter supplemented and amended being
hereinafter referred to as the "Indenture"), to which Indenture and all
indentures supplemental thereto reference is hereby made for a description of
the rights, limitations of rights, obligations, duties and immunities thereunder
of the Trustee, the Company and the holders of the Notes. By the terms of the
Indenture, the Notes are issuable in series which may vary as to amount, date of
maturity, rate of interest and in other respects as in the Indenture provided.
This Note is one of the series of Notes designated on the face hereof as 5.50%
Senior Notes, Series [A/B] due 2013 initially issued in the aggregate principal
amount of $225,000,000.
This Note may be redeemed by the Company at its option, in whole at any
time or in part from time to time, upon not less than thirty but not more than
sixty days' previous notice given by mail to the registered owners of the Note
at a redemption price equal to the greater of (i) 100% of the principal of the
Note being redeemed and (ii) the sum of the present values of the remaining
scheduled payments of principal and interest on the Note being redeemed
(excluding the portion of any such interest accrued to the date of redemption)
discounted (for purposes of determining present value) to the redemption date on
a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the Treasury Rate (as defined below) plus 25 basis points, plus, in each
case, accrued interest thereon to the date of redemption.
"Treasury Rate" means, with respect to any redemption date, the rate
per annum equal to the semi-annual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury
Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such redemption date.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Notes that would be utilized,
at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of
comparable maturity to the remaining term of the Notes.
Ex. A-5
"Comparable Treasury Price" means, with respect to any redemption date,
(1) the average of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount)
on the third Business Day preceding such redemption date, as set forth
in the daily statistical release (or any successor release) published
by the Federal Reserve Bank of New York and designated "Composite 3:30
p.m. Quotations for U.S. Government Securities" or (2) if such release
(or any successor release) is not published or does not contain such
prices on such third Business Day, the Reference Treasury Dealer
redemption date.
"Independent Investment Banker" means one of the Reference Treasury
Dealers appointed by the Company and reasonably acceptable to the
Trustee.
"Reference Treasury Dealer" means a primary U.S. government securities
dealer selected by the Company and reasonably acceptable to the
Trustee.
"Reference Treasury Dealer Quotation" means, with respect to the
Reference Treasury Dealer and any redemption date, the average, as
determined by the Trustee, of the bid and asked prices for the
Comparable Treasury Issue (expressed in each case as a percentage of
its principal amount) quoted in writing to the Trustee by such
Reference Treasury Dealer at or before 5:00 p.m., New York City time,
on the third Business Day preceding such redemption date.
The Company shall not be required to (i) issue, exchange or register
the transfer of any Notes during a period beginning at the opening of business
15 days before the day of the mailing of a notice of redemption of less than all
the outstanding Notes of the same series and ending at the close of business on
the day of such mailing, nor (ii) register the transfer of or exchange of any
Notes of any series or portions thereof called for redemption. This Global Note
is exchangeable for Notes in definitive registered form only under certain
limited circumstances set forth in the Indenture.
In the event of redemption of this Note in part only, a new Note or
Notes of this series, of like tenor, for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the surrender of this Note.
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of all of the Notes may be declared,
and upon such declaration shall become, due and payable, in the manner, with the
effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions for defeasance at any time of the
entire indebtedness of this Note upon compliance by the Company with certain
conditions set forth therein. This Note will not have a sinking fund.
As described in the supplemental indenture relating to the Notes, so
long as this Note is outstanding, the Company is subject to a limitation on
issuance of Secured Debt as described therein.
Ex. A-6
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the Holders of not less than a majority in
aggregate principal amount of the Notes of each series affected at the time
outstanding, as defined in the Indenture, to execute supplemental indentures for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of the Indenture or of any supplemental indenture or of
modifying in any manner the rights of the Holders of the Notes; provided,
however, that no such supplemental indenture shall (i) extend the fixed maturity
of any Notes of any series, or reduce the principal amount thereof, or reduce
the rate or extend the time of payment of interest thereon, or reduce any
premium payable upon the redemption thereof, or reduce the amount of the
principal of a Discount Security that would be due and payable upon a
declaration of acceleration of the maturity thereof pursuant to the Indenture,
without the consent of the holder of each Note then outstanding and affected;
(ii) reduce the aforesaid percentage of Notes, the holders of which are required
to consent to any such supplemental indenture, or reduce the percentage of
Notes, the holders of which are required to waive any default and its
consequences, without the consent of the holder of each Note then outstanding
and affected thereby; or (iii) modify any provision of Section 6.01(c) of the
Indenture (except to increase the percentage of principal amount of securities
required to rescind and annul any declaration of amounts due and payable under
the Notes), without the consent of the holder of each Note then outstanding and
affected thereby. The Indenture also contains provisions permitting the Holders
of a majority in aggregate principal amount of the Notes of all series at the
time outstanding affected thereby, on behalf of the Holders of the Notes of such
series, to waive any past default in the performance of any of the covenants
contained in the Indenture, or established pursuant to the Indenture with
respect to such series, and its consequences, except a default in the payment of
the principal of or premium, if any, or interest on any of the Notes of such
series. Any such consent or waiver by the registered Holder of this Note (unless
revoked as provided in the Indenture) shall be conclusive and binding upon such
Holder and upon all future Holders and owners of this Note and of any Note
issued in exchange herefor or in place hereof (whether by registration or
transfer or otherwise), irrespective of whether or not any notation of such
consent or waiver is made upon this Note.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and premium, if any, and
interest on this Note at the time and place and at the rate and in the money
herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, this Note is transferable by the registered holder hereof on the
Security Register of the Company, upon surrender of this Note for registration
of transfer at the office or agency of the Company as may be designated by the
Company accompanied by a written instrument or instruments of transfer in form
satisfactory to the Company or the Trustee duly executed by the registered
Holder hereof or his or her attorney duly authorized in writing, and thereupon
one or more new Notes of authorized denominations and for the same aggregate
principal amount and series will be issued to the designated transferee or
transferees. No service charge will be made for any such transfer, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in relation thereto.
Ex. A-7
Prior to due presentment for registration of transfer of this Note, the
Company, the Trustee, any paying agent and any Security Registrar may deem and
treat the registered Holder hereof as the absolute owner hereof (whether or not
this Note shall be overdue and notwithstanding any notice of ownership or
writing hereon made by anyone other than the Note Registrar) for the purpose of
receiving payment of or on account of the principal hereof and premium, if any,
and interest due hereon and for all other purposes, and neither the Company nor
the Trustee nor any paying agent nor any Security Registrar shall be affected by
any notice to the contrary.
No recourse shall be had for the payment of the principal of or the
interest on this Note, or for any claim based hereon, or otherwise in respect
hereof, or based on or in respect of the Indenture, against any incorporator,
stockholder, officer or director, past, present or future, as such, of the
Company or of any predecessor or successor corporation, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise, all such liability being, by the acceptance hereof and as
part of the consideration for the issuance hereof, expressly released waived and
released.
The Notes of this series are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof except that
a Note issued to an Institutional Accredited Investor will be in denominations
of at $250,000. As provided in the Indenture and subject to certain limitations,
Notes of this series are exchangeable for a like aggregate principal amount of
Notes of this series of a different authorized denomination, as requested by the
Holder surrendering the same.
All terms used in this Note which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
This Note shall not be entitled to any benefit under the Indenture
hereinafter referred to, be valid or become obligatory for any purpose until the
Certificate of Authentication hereon shall have been signed by or on behalf of
the Trustee.
IN WITNESS WHEREOF, the Company has caused this Instrument to be
executed.
AEP TEXAS NORTH COMPANY
By: ______________________________________
Attest:
By: ____________________________
Ex. A-8
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM- as tenants in common UNIF GIFT MIN ACT-_____ Custodian ________
(Cust) (Minor)
TEN ENT- as tenants by the under Uniform Gifts to
entireties Minors Act
-------------------------
(State)
JT TEN- As joint tenants with
right of survivorship
and not as tenants in
common
Additional abbreviations may also be used
though not on the above list.
FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto
___________________ (please insert Social Security or other identifying number
of assignee)
--------------------------------------------------------------------------------
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF
ASSIGNEE
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing
--------------------------------------------------------------------------------
agent to transfer said Note on the books of the Company, with full power of
substitution in the premises.
Dated___________________ ________________________________________________
________________________________________________
NOTICE: The signature to this assignment must
correspond with the name as written upon the
face of the within instrument in every
particular without alteration or enlargement,
or any change whatever.
Ex. A-9
In connection with any transfer of any of the Series A Notes evidenced
by this certificate, the undersigned confirms that such Series A Notes are
being:
CHECK ONE BOX BELOW
(1) [ ] exchanged for the undersigned's own account without transfer;
or
(2) [ ] transferred to a person whom the undersigned reasonably
believes to be a "qualified institutional buyer" as defined in
Rule 144A under the Securities Act of 1933 who is purchasing
such Series A Notes for such buyer's own account or the account
of a "qualified institutional buyer" in a transaction meeting
the requirements of Rule 144A under the Securities Act of 1933
and any applicable securities laws of any state of the United
States or any other jurisdiction; or
(3) [ ] exchanged or transferred pursuant to and in compliance with
Rule 903 or 904 of Regulation S under the Securities Act of
1933; or
(4) [ ] exchanged or transferred to an institutional "accredited
investor" within the meaning of Rule 501(a)(1), (2), (3) or (7)
of Regulation D under the Securities Act pursuant to Rule 144A
(and based upon an opinion of counsel if the Company or the
Trustee so requests) and, to the knowledge of the transferor of
the Series A Notes, such institutional accredited investor to
whom such Note is to be transferred is not an "affiliate" (as
defined in Rule 144 under the Securities Act) of the Company;
or
(5) [ ] transferred pursuant to another available exemption from the
registration requirements of the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register
any of the Series A Notes evidenced by this certificate in the name of any
person other than the registered Holder thereof; PROVIDED, HOWEVER, that if box
(3), (4) or (5) is checked, the Company may require, prior to registering any
such transfer of the Series A Notes, such legal opinions, certifications and
other information as the Company has reasonably requested to confirm that such
transfer is being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act of 1933, such as
the exemption provided by Rule 144 under such Act; PROVIDED, FURTHER, that if
box (2) is checked, the transferee must also certify that it is a qualified
institutional buyer as defined in Rule 144A.
----------------------------------------
Signature
---------------------------------------
Ex. A-10
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Series A Note for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such information
regarding the Company as the undersigned has requested pursuant to Rule 144A or
has determined not to request such information and that it is aware that the
transferor is relying upon the undersigned's foregoing representations in order
to claim the exemption from registration provided by Rule 144A.
Date: _________________
_______________________
NOTICE: TO BE EXECUTED BY AN EXECUTIVE OFFICER.
Ex. A-11
SCHEDULE A
The initial aggregate principal amount of Series A Notes evidenced by
the Certificate to which this Schedule is attached is $___________. The
notations on the following table evidence decreases and increases in the
aggregate principal amount of Series A Notes evidenced by such Certificate.
Principal Amount of
Series A Notes Remaining
Decrease in Principal Amount Increase in Principal After Such Decrease or Notation by
of Series A Notes Amount of Series A Notes Increase Security Registrar
---------------------------- ------------------------ ------------------------- ------------------
Ex. A-12
EXHIBIT B
CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the within-mentioned Indenture.
BANK ONE, N. A.,
as Trustee
By:_______________________
Authorized Signatory
Ex. B-1
EXHIBIT C
FORM OF TRANSFER CERTIFICATE
In connection with any transfer of any of the Series A Notes evidenced
by this certificate, the undersigned confirms that such Series A Notes are
being:
CHECK ONE BOX BELOW
(1) [ ] exchanged for the undersigned's own account without transfer; or
(2) [ ] transferred to a person whom the undersigned reasonably believes to
be a "qualified institutional buyer" as defined in Rule 144A under
the Securities Act of 1933 who is purchasing such Series A Notes
for such buyer's own account or the account of a "qualified
institutional buyer" in a transaction meeting the requirements of
Rule 144A under the Securities Act of 1933 and any applicable
securities laws of any state of the United States or any other
jurisdiction; or
(3) [ ] exchanged or transferred pursuant to and in compliance with Rule
903 or 904 of Regulation S under the Securities Act of 1933; or
(4) [ ] exchanged or transferred to an institutional "accredited investor"
within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation
D under the Securities Act pursuant to Rule 144A (and based upon an
opinion of counsel if the Company or the Trustee so requests) and,
to the knowledge of the transferor of the Series A Notes, such
institutional accredited investor to whom such Note is to be
transferred is not an "affiliate" (as defined in Rule 144 under the
Securities Act) of the Company; or
(5) [ ] transferred pursuant to another available exemption from the
registration requirements of the Securities Act of 1933. Unless one
of the boxes is checked, the Trustee will refuse to register any of
the Series A Notes evidenced by this certificate in the name of any
person other than the registered Holder thereof; PROVIDED, HOWEVER,
that if box (3) or (4) is checked, the Company may require, prior
to registering any such transfer of the Series A Notes, such legal
opinions, certifications and other information as the Company has
reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act of 1933, such
as the exemption provided by Rule 144 under such Act; PROVIDED,
FURTHER, that if box (2) is checked, the transferee must also
certify that it is a qualified institutional buyer as defined in
Rule 144A.
--------------------------------------
Signature
Ex. C-1
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Series A Note for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such information
regarding the Company as the undersigned has requested pursuant to Rule 144A or
has determined not to request such information and that it is aware that the
transferor is relying upon the undersigned's foregoing representations in order
to claim the exemption from registration provided by Rule 144A.
Date: _______________
______________
NOTICE: TO BE EXECUTED BY AN EXECUTIVE OFFICER.
Ex. C-2
EXHIBIT D
FORM OF LETTER TO BE DELIVERED BY
INSTITUTIONAL ACCREDITED INVESTORS
Ladies and Gentlemen:
In connection with our proposed purchase of the 5.50% Senior Notes,
Series A due 2013 (the Notes) issued by AEP Texas North Company, a Texas
corporation (Issuer), we confirm that:
1. We are purchasing the Notes for our own account, or for one or
more investor accounts for which we are acting as a fiduciary or
agent, in each case for investment, and not with a view to, or for
offer or sale in connection with, any distribution in violation of
the Securities Act, subject to any requirement of law that the
disposition of our property or the property of such investor
account or accounts be at all times within our or their control
and subject to our or their ability to resell the Notes pursuant
to Rule 144A, Regulation S or any exemption from registration
available under the Securities Act.
2. We are an institutional "accredited investor" within the meaning
of Rule 50l(a)(l), (2), (3) or (7) under the Securities Act who is
purchasing Notes with a principal amount of at least $250,000 and,
if the Notes are to be purchased for one or more accounts (the
"investor accounts") for which we are acting as fiduciary or
agent, each such account is an institutional accredited investor
who is purchasing Notes with a principal amount of at least
$250,000. In the normal course of business or our investing
activities, we invest in or purchase securities similar to the
Notes and we have such knowledge and experience in financial
business matters that we are capable of evaluating the merits and
risks of purchasing the Notes. We are aware that we (or any
investor account) may be required to bear the economic risk of an
investment in the Notes for an indefinite period of time and we
(or such investor account) are able to bear such risk for an
indefinite period.
3. We acknowledge that none of the Issuer, the initial purchasers or
any persons representing any of them has made any representation
to us with respect to any such entity or the offering or sale of
any Notes, other than the information contained in the Issuer's
offering memorandum dated February 12, 2003, related to the Notes,
which offering memorandum has been delivered to it and upon which
it is relying in making its investment decision with respect to
the Notes. Accordingly, we acknowledge that no representation or
warranty is made by the initial purchasers as to the accuracy or
completeness of such materials. We have had access to such
financial and other information concerning the Issuer and the
Notes as we have deemed necessary in connection with our decision
to purchase any of the Notes including an opportunity to ask
questions of, and request information from, the Issuer and the
initial purchasers.
Ex. D-1
4. We understand and agree that the offer and sale of the Notes have
not been registered under the Securities Act and that such Notes
are being offered only in a transaction not involving any public
offering within the meaning of the Securities Act, and that (A) if
we decide to resell, pledge or otherwise transfer such Notes on
which a legend setting forth these restrictions appears, such
Notes may be resold, pledged or otherwise transferred only (i) to
the Issuer, (ii) in a transaction entitled to an exemption from
registration provided by Rule 144 under the Securities Act, (iii)
so long as such Notes are eligible for resale pursuant to Rule
144A, to a person whom we reasonably believe is a qualified
institutional buyer that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given
that the resale, pledge or other transfer is being made in
reliance on Rule 144A, (iv) outside the United States in a
transaction meeting the requirements of Regulation S, (v) in
accordance with another exemption from the registration
requirements of the Securities Act (and based upon an opinion of
counsel acceptable to the Issuer), in each case in accordance with
any applicable securities laws of any state of the United States
or (vi) pursuant to a registration statement which has been
declared effective under the Securities Act and (B) we will, and
each subsequent holder is required to, notify any purchaser of
Notes from us or it of the resale restrictions referred to in (A)
above, if then applicable. We acknowledge that the foregoing
restrictions apply to holders of beneficial interest in the Notes,
as well as to holders of the Notes.
5. We understand that, on any proposed resale of any Notes, we will
be required to furnish to the trustee and the Issuer such
certifications, legal opinions and other information as the
trustee and the Issuer may reasonably require to confirm that the
proposed sale complies with the foregoing restrictions. We further
understand that the Notes purchased by us will bear a legend to
the foregoing effect.
6. We acknowledge that the Issuer, the trustee, the initial
purchasers and others will rely upon the truth and accuracy of the
foregoing acknowledgements, representations and agreements and
agree that if any of the foregoing acknowledgements,
representations or agreements are no longer accurate, we shall
promptly notify the Issuer, the trustee and the initial
purchasers. If we are acquiring the Notes as a fiduciary or agent
for one or more investor accounts, we represent that we have sole
investment discretion with respect to each such account and we
have full power to make the foregoing acknowledgements,
representations and agreements on behalf of each account and that
each such investor account is eligible to purchase the Notes.
Ex. D-2
7. The Issuer, the trustee and the initial purchasers are entitled to
rely upon this letter and are irrevocably authorized to produce
this letter or a copy hereof to any interested party in any
administrative or legal proceeding or official inquiry with
respect to the matters covered hereby.
Very truly yours,
By:
Name:
Title:
Ex. D-3
